Paul Krugman: Free-Floating Inflation Hysteria:
What remains notable, however, is just what all Republicans are obliged to say: Ron Paul monetary theory has become obligatory:
Vice Chair Yellen will continue the destructive and inflationary policy of pouring billions of newly printed money every month into our economy, and artificially holding interest rates to near zero. This policy has been in place far too long.
So, the Fed began rapidly expanding its balance sheet when Lehman fell — more than five years ago. [What's been] the result of that “destructive and inflationary” policy so far[?] It’s not often that you see an economic theory fail so utterly and completely. Yet that theory’s grip on the GOP has only strengthened as its failure becomes ever more undeniable....
I can, in a way, understand refusing to believe in global warming--that’s a noisy process, with lots of local variation, and the overall measures are devised by pointy-headed intellectuals who probably vote Democratic. I can even more easily understand refusing to believe in evolution. But the failure of predicted inflation to materialize is happening in real time, right in front of our eyes; people who kept believing in inflation just around the corner lost a lot of money. Yet the denial remains total.
I guess it’s a matter of who you’re gonna believe — Ayn Rand or your own lying eyes.